EDITOR'S CHOICE -- SCOTT SUTTELL

Reuters says shale's impact on job creation in Ohio is disappointing

Blog Entry: June 14, 2013 11:11 AM | Author: SCOTT SUTTELL

Shale has provided a boom to manufacturers, but not to their workers, according to this analysis from Reuters.

A French-Japanese joint venture, Vallourec Star, just opened a $1.1 billion state-of-the-art steel pipe mill in Youngstown, “a big example of the money that has flowed into the state's industrial sector in recent years thanks to the surge in U.S. natural gas and oil drilling,” the news service says. Timken Co. and U.S. Steel Corp., among others, are pumping millions of dollars into their Ohio plants to boost production.

“But state employment data, academic research and a week-long tour of half a dozen factories in Ohio suggests the shale gas revolution has been a disappointment when it comes to job creation,” Reuters reports.

Tom Waltermire, CEO of economic development organization Team NEO, tells Reuters, “The industries benefiting are more capital intensive than labor intensive. Even a manufacturing renaissance won't require the same headcount per unit of output as we had 20 or 30 years ago. If it did require that, the renaissance would never happen."

Reuters cites a March study by Cleveland State University that concluded that while gas exploration had unleashed a surge in economic activity in Ohio, “job growth — even in counties directly affected by the drilling — was stagnant.” The employment growth that many assumed would follow the energy investment was "not yet evident," the study's authors said.

For instance, the big Vallourec Star will employ just 350 workers. And the $100 million Timken put into a new intermediate finishing line at its Faircrest Steel Plant in Canton ultimately results in fewer, not more, jobs.

“Timken's old intermediate finishing line employed more than 200 workers and processed pipe and other products in 10 days, according to plant manager Larry Pollock,” Reuters reports. “The new facility, built to meet surging demand from the energy industry, employs fewer than 30 and can process the same material in as little as two hours.”

Changing times

The Cleveland Orchestra long has enjoyed a spot in the Big Five American orchestras, along with the Boston Symphony Orchestra, the Chicago Symphony Orchestra, the New York Philharmonic and the Philadelphia Orchestra.

But this piece in The New York Times argues that while “the idea of the Big Five may still exist in the public imagination, you no longer hear talk of it in the profession except from Big Five members, when, occasionally, they find it useful.”

The orchestra landscape “has changed greatly over the last half-century,” according to the newspaper, and “the economic fortunes of the flagship ensembles have changed with the fortunes of their cities.”

The Times says the criteria of membership in the Big Five, “never firmly established, began with quantities. They included size of budget, number of recordings, amount of touring (especially stops in New York), presence on radio and television, and number of year-round musicians. Quality, it was more or less assumed, would follow the numbers.”

That's vague, but “the notion of a Big Five carried real meaning and impact for a time,” The Times says.

“If you go far enough back, 30 to 40 years,” says Gary Hanson, the Cleveland Orchestra's executive director, “the defining element of success had a lot more to do with an institution's ability to compete for talent than anything else. In that competitive environment, there was a direct relationship between reputation and quality.”

Mr. Hanson tells The Times that the Big Five orchestras benefit slightly from a “residual reputational momentum.” He adds, “But today, the ability to maintain a viable orchestra and pursue greater quality depends almost entirely on philanthropy. It depends on the ability of the local community to fund its orchestra.”

Cleveland “is a particularly difficult case,” The Times concludes, “with so many corporations having fled the city. But with Franz Welser-Möst as music director, the Cleveland Orchestra has retained its lofty artistic profile while relying on major gifts and on residencies in Miami, Vienna and elsewhere.”

This and that

Claiming their turf: A Stark County company is among those giving artificial grass a fresh look, according to this story in The Wall Street Journal.

Manufacturers “have developed new 'yarns' that make synthetic grass look less shiny and more natural,” the newspaper says. There are six companies — including the Stark County company, ForeverLawn in Uniontown — that make artificial grass in the United States, and The Journal says residential sales have increased about 30% a year for the past five years, according to the Association of Synthetic Grass Installers.

“Homeowners can have a full lawn of artificial grass installed or use it in specific areas: between pavers in a driveway, in a courtyard, around swimming pools and under swing sets,” according to The Journal.

There are even varieties of synthetic grass for pet owners that include a drainage system, says Brian Karmie, co-founder of ForeverLawn.

The pros of artificial lawns: No mowing or watering required, and most last 15 to 20 years. The downside: “Prices can be high, with large, high-quality lawns costing as much as $100,000,” according to the newspaper.

First, do no harm: Bloomberg reports that crash-avoidance technology that engages truck brakes automatically before an impending crash “may prevent almost 300 fatalities a year and yield $3.1 billion in economic benefits,” according to a U.S. Transportation Department report.

The U.S.-financed study, conducted by University of Michigan Research Institute and posted to the National Highway Traffic Safety Administration website, “is part of the agency's review as it decides whether to issue a regulation later this year,” according to the news services.

Crash-avoidance technology already is “on the road in small numbers,” Bloomberg says. Bendix Commerical Vehicle Systems, an Elyria-based unit of German manufacturer Knorr-Bremse AG, is among the leaders in the emerging field, according to the story.

Summertime pleasures: As part of its summer travel coverage USA Todayprofiles the Cuyahoga Valley National Park, which it says “may be the least-known and most family-friendly national park that draws big summer crowds.”

It's “an unusual national park because it lacks a natural spectacle — not a mountain, canyon, crater or even a natural lake,” according to the newspaper.

Nonetheless, hiking trails abound, “and the flat park is a bicyclist's paradise,” USA Today says. “Few trails will challenge the ultra-fit, but they're perfect for parents with young kids or aging Baby Boomers looking to mix exercise and beauty. One long trail stretches along the old Ohio & Erie Canal next to a working tourist train that runs for 20 miles.”

It's not unusual, the paper says, “to see 6,000 people on the Ohio & Erie Canal Towpath — one of four major bike paths in the park — on a Sunday afternoon. Spread over 20 miles, that's not as crowded as it may sound.”

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